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Week 15 US Tax Withholdings Drop, YoY Cumulative Divergence Now At Second Highest For 2010
Below is an update of the most recent US Treasury tax withholding picture. As one can very plainly see it is getting worse, on both a week over week, a YTD cumulative basis, and, probably most relevantly to some readers, on a 4 week running bucket cumulative basis. In the week ended April 16, the US Treasury collected $29.3 billion, 10% less than the comparable week in the prior year when $32.5 billion was withheld. Cumulatively, the difference is now at an almost 2010 low, dropping to a $16.7 billion difference between the YTD period and the comparable period in 2009.
The WoW chart below is self-explanatory.
The same chart on a comparartive cumulative YTD basis. Note the deterioration in comps in the last week, which has dropped to the lowest since Week 3.
And since some have pointed out it makes sense to demonstrate monthly performance, here is the cumulative monthly chart by weekly buckets Year To Date. We dare ask: where is this alleged sustainable improvement since the beginning of the year?
To be sure, the last bucket includes just Weeks 13-15, so one more week will be required for an apples to apples 4 week bucket. For the last bucket to be merely flat (0.0% change), the current week will need to generate $33.1 billion in tax withholdings, a 19% increase over the $26.8 billion withheld in the year ago period. We will update this chart once this week's data is released. We are not anticipating a 19% increase in weekly withholdings.
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Only $33 billion? Golden Slacks made that Friday on the put/call ratio.
Viola! Problem solved.
For income tax withholding purposes my wife and I have 10 children. With money tight, maybe others are deciding to minimize the amount the government borrows from them at 0% interest.
Or more likely jobs are dissappearing and not hitting the u3
Bingo, I believe we have a winner. Given government's incentives, tax revenue is one of the few reliable numbers and tells us a great deal about the receovery. That is, if the numbers hold, there hasn't been one and won't be one (i.e., in any meaningful sense of the word).
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It would be interesting to overlay this with the BLS numbers.
<msacras>Matt's not going to be happy with this post, Tyler. He and TBP will have to write another article to prove you wrong. You're just playing with fire, here. And you'll get burned and will not be accepted in Wall Street. And if you fail to get into the inner circle of WS, how are you then going to talk to your clients, do a Tech Ticker interview, a radio interview and make arrangements for a TV appearance, while an anonymous blogger blogs. Huh, how are you going to do that? Have you thought about that for a minute?</msacras>
Matt acknowledges the big drop in the data notes section of his site. The deterioration is
quite clear in his own charts of the 21 day moving average of withholding taxes.
payroll tax jubalee...just not endorsed by turbo Timmy. Starve the beast anyway you can..
tea parties are dandy but withholding your taxes is hitting them where they live..short of bullets it is all we have left.
November not withstanding..your vote will be nullified by the rampant voter fraud they have planned.."Here's your republic now see if you can keep it"
But what happened to Mr. Trivisonno's trend? Must be an error in the way ZH doesn't parse the data. Nobody uses raw data anymore. Toss the data in a salad bowl, pick out the parts you like, and I'm sure you'll find Mr. T's trend is exactly like he said it was.
Not.
This means VAT. If Team Obama doesn't move on that sneaky job killing VAT before November , the ripped seams are going to get even more obvious. And then he has to think about an emboldened GOP after the big Dem sweep kicks in.
The plan for 2011 is to push him into an outright big ass middle class tax hike .....an insurance policy to insure he'll be good and fresh stinky by '12.
Sooner or later, the money will catch up to all these bullshitters and they'll have to fess up on the size of the phallic instrument they're about to shove up our.......
I welcome the VAT. At least the super rich will pay some taxes as well as the 50% of the population that pays no Federal tax. Perhaps if more people feel the pain our dear politicians will have to spend with caution and not at the behest of lobby groups and public unions.
Dry up the life force! Squeeze them till they die on the vine. On to Bartertown!
Okay, now we getting somewhere!!! This means either:
1. People are taking ZH serious and changing their W-4 withholdings to keep their money in their pockets now instead of giving it to Helicopter Ben and Timmy "Tax Evader" Giethner.
OR....
2. The job picture is getting worse and is not improving as the corrupt government claims?? Who do they think they are fooling? You cannot say people are being hired when the tax receipts keep falling off the cliff. Jeezzz.. I guess the majority of the American public really is that stupid after all.
But I will vote for 1 and 2 above anyway. LOL
That's unfortunate.
oh Dear...very curious...very interesting...I thought I was doing the nation's unemployment rate a service by becoming a part-time college instructor at 1/20th my previous salary as a sales manager. I wonder if all the repercussions of my lay off were anticipated by my previous employer. Perhaps I should call them to ask for reinstatement so tax receipts may improve...perhaps a subsidy could be negotiated...at least I am employed...sort of...
Matt actually made 2 pretty good points and he has a nice website.
First, he pointed out that YoY trend had turned positive (which, at the time, it had).
Second, he noted that the Q1 2010 numbers were not truely comparable to Q1 2009 because of a change in withholding laws as a result of the stimulus bill which took effect in April 2009.
Unfortunately for Matt's theory that the economy is adding jobs and expanding, the YoY trend is once again negative, and we have now anniversaried the change in the withholding laws so the data should now be a good apples-to-apples comparison, and the comparision ain't good.
2010 final receipts will be down big too. Many are making capital investments so as to show zero business income just out of spite for owebama and the dems.
and are claiming 14 dependants so they have enough of their pay check left to buy food.
I think this is very consistent with what we are seeing so far in the earnings picture. Banks are making money by trading. Other businesses are making money by cutting costs. Revenues are still light. IBM as an example only improved revenues by 5% YoY compared to last year - which was dismal to boot. Now the question remains - how much trading and cost cutting can carry that economy forward? I think the market is starting to get it - excluding the usual green Monday of course.
Nice doublespeak. "Cost cutting" = "Firing Employees" = "Forward Movement"
remember, most folks getting hired into new jobs are earning less than they did in their previous job. Wage Deflation will lead to lower tax receipts.
i sir, am one of those people. laid off. unemployed six weeks. rehired for IDENTICAL job, diff. company, 33% less, no benefits or perks. Its worth it if Llyod gets a bigger bonus though. F the world.
The economy is a self-fulfilling prophecy: with all the Goldman hoopla the simultaneous plunge in small business and consumer confidence was barely noticed. However this is most definitely the result of the great Double Whammy of simultaneous deflation and inflation. Deflationary forces are picking up a little steam and are heading to a Japan type scenario. No pickup in incomes and real asset values yet, but the cost of living and dong business creeps up. People are preparing for a tax assault at all levels including petty taxes and charges. The cost of consumer credit is not reflected in the yield curve but is a drag on spending.
My company has just announced 8 more postions to be cut next month. Things are getting worse not better. Cash flow could support these jobs but have managment has chosen bottom line to compensate for loss of growth. We will be losing very creative and motivated individuals.
Sad day. I am fine for now. Do not know how the year will end up.
The Rockefeller Institute maintains highly detailed statistics and data series on state tax collections, including income taxes. In the fourth quarter of 2009, the 45 states that collect income taxes reported that individual income tax collections were 16% below the level at the start of the depression. Year to year comparisons, state by state data, etc. are all in the
April 16, 2010 report.
TD, Instapundit linked to this thread. This is good, the PJ crowd needs this stuff.
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